Intel Ireland ‘warms down’ over Christmas

Q4 cost cuts

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A company spokesperson explained to ElectricNews.Net that most of the company's 3,200 employees will be asked to take leave between 20 December and 6 January, as the firm prepares for sluggish sales following Christmas. The spokesperson explained that employees who have no annual leave remaining for 2002 will be asked to take an unpaid break or dip into their holiday days for next year.

In addition, a limited number of employees will be required to participate in a so-called "warm-down" between 22 December and 2 January. Cleaning, maintenance and service operations will continue throughout the warm-down period. The announcement was made to employees 12 days ago, the spokesperson said, and so far workers seem to be reacting well to the news.

"The move is a cost-saving measure, and there are three bank holidays during that period so we hope they [employees] won't find the measures too draconian," the Intel Ireland spokesperson said. He also said that between now and Christmas staff had been offered the option of taking two additional weeks of unpaid time off, but this programme is not mandatory.

The company spokesperson admitted that "it's a tough time for the chip business," a sentiment that resonates throughout the company all the way up to Chief Executive Officer Craig Barrett, who in late August said that demand for PCs and the chips they contain may not rebound during the holiday season this year. "There is always some anticipation of a holiday season up-tick in computer sales, but whether that materialises or not is a question mark," Barrett commented during a trip to Malaysia in August.

Consumers, who make up a third of the PC market, are expected to hold off on buying new PCs this year for Christmas, a time that PC makers and chipmakers can generally depend on for booming sales. And with businesses still keeping a tight rein on IT spending, the prospect of a full recovery in the semiconductor industry this year, or even in the early months of next year, has effectively been stymied.

Earlier in September, research company IDC said that shipments of personal computers will be lower than expected this year and next because of lacklustre demand from consumers and large businesses. Shipments will rise 1.1 percent this year to 135.5 million, IDC said, revising its 4.7 percent gain estimated in June. "We don't expect to see a significant recovery until both consumer and business demand picks up, and we may reach the middle of next year before that happens," Loren Loverde, director of IDC's Worldwide Quarterly PC Tracker, said when that report was released.

Still, Intel and most others involved in the semiconductor business expect long-term growth, and Barrett himself constantly notes that innovation and investment in new technologies and techniques will drive recovery in the industry. In this vein Intel said in April that construction at Leixlip on its latest semiconductor facility in Ireland, Fab 24, will re-commence after a one-year work stoppage. The warm-down over Christmas and the New Year will not affect work at Fab-24.

When fully operational, Fab 24 is expected to employ approximately 1,000 people, and currently over 120 Irish employees who will eventually work at Fab24 are working at Intel's technology development centre in Portland, Oregon. To date there are already 300 people assigned to the Fab 24 project.